Scrap at Telsla Gigafactory

Six Sigma – iSixSigma Forums General Forums Implementation Scrap at Telsla Gigafactory

This topic contains 3 replies, has 2 voices, and was last updated by  Mike Carnell 9 months, 2 weeks ago.

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    In a recent article at Business Insider (, it states that:

    “Tesla, the electric-car company helmed by the billionaire Elon Musk, is generating an incredible amount of waste in an effort to manufacture parts for the Model 3 at its Gigafactory in Nevada.”

    “Documents reviewed by Business Insider show that scrap at the Gigafactory may have cost the company at least $150 million.”

    40% of the raw materials they’re using to make the batteries and driving units are being scrapped. !!!

    Is scrap a required by-product of innovation?

    Who the heck is in charge of this crazy manufacturing facility?!


    Chris Seider

    It’s silly to comment from the outside without seeing data from the inside.

    However, not everyone is an investor in Tesla. I don’t understand how its valuation is larger than GM, Ford, etc and they make a fraction of the vehicles of these peers.

    I’ve heard of some really nice tulips from Holland at one time.


    Chris Seider

    Oh, and thanks for the link–it was a good read.


    Mike Carnell

    John Somebody has to pay for the scrap. It either gets built into the price of the product or it comes out of the companies profits.

    Is that the price of innovation? Typical SS answer – It depends. If you are first one into a market and the premium for being first in off sets the extra cost then it makes sense. If there isn’t that price advantage then a lot of what Tesla is going through should have been done in a Lab.

    There is nothing special about the Tesla story except that it gets a lot of press. If you look at how much you shipped out of your company and then cost out material and labor for that many units and compare it to what your company spent on material and labor you might be surprised at how much waste you paid for.

    @cseider the company valuation is a joke. Remember the movie The Big Short? Read the book instead of watching the movie (because you have the time now)and then walk away and think about the ratings. Put it in the perspective of an MSA.

    Just my opinion.

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